FEDS CRACK DOWN ON FOOD STAMP TRAFFICKING
Investigation Results in Arrest of ‘Runners’ and Store Owner

FOR IMMEDIATE RELEASE

October 5, 2010

An undercover investigation of food stamp trafficking at stores in Seattle’s International District resulted in three arrests today and the seizing of numerous business records at two grocery stores. According to the criminal complaint filed in the case, SEATTLE CHINESE HERB & GROCERY at 1203 S. Jackson Street redeemed more then $2 million in food stamps between July 2009 and July 2010. Records indicate the vast majority of the food stamp redemptions appear fraudulent. ELSA MA KWONG, 46, the owner of Seattle Chinese Herb and Grocery was arrested today and charged with Supplemental Nutrition Assistance Program (SNAP) fraud. The SNAP program was previously known as the food stamp program. Two other women, who facilitated the fraud by recruiting and assisting those trading their SNAP benefits for cash, were also arrested. AHN THI NGUYEN, 53, and MUOI LY, 65, both of Seattle, are also charged by complaint with SNAP benefit fraud. The complaints allege some of the fraudulent redemptions also occurred at HOP THANH SUPERMARKET at 1043 S. Jackson Street, Seattle.

“The Supplemental Nutrition Assistance Program is a critical safety net for people who need to put food on the table,” said U.S. Attorney Jenny A. Durkan. “We owe it to them and to taxpayers to stop this abuse. Those who corrupt the system for their own gain will be held accountable.”

According to records filed in the case, in late 2007, the U.S. Department of Agriculture Office of Inspector General (USDA-OIG) began investigating SNAP benefit trafficking in Seattle’s International District. In 2009, the Seattle Police Department joined the investigation. Using undercover officers and video surveillance, law enforcement documented SNAP benefit trafficking at a variety of locations. Runners would approach those who had received their monthly SNAP benefit card – similar to a debit card. The debit card would be run at one of the grocery stores for a set amount, for example $200. The recipient would get half the value in cash – in this example, $100. The store would keep the rest of the cash, and pay the runner a fee for bringing in the person making the fraudulent transaction. Records show that hundreds of dollars in transactions would occur over just a few minutes, an indication that no actual groceries were being scanned and purchased. Thus the stores were profiting not only on half the value of the debit card, but they also did not provide any goods in exchange for the cash.

SNAP fraud is punishable by up to 5 years in prison and a $20,000 fine.

The charges contained in the complaints are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.

The case is being investigated by the U.S. Department of Agriculture Office of Inspector General (USDA-OIG) and the Seattle Police Department. The case is being prosecuted by Assistant United States Attorney Kate Crisham.

For additional information please contact Emily Langlie, Public Affairs Officer for the United States Attorney’s Office, at (206) 553-4110 or Emily.Langlie@USDOJ.Gov.